Australian shares ended higher on Monday, driven by commodity and financial stocks on expectations that the local central bank might hold rates at its policy meeting on Tuesday, while Origin Energy fell after investors voted down the Brookfield-led consortium’s takeover bid.
The S&P/ASX 200 index closed 0.7% higher at 7,124.70 points, after hitting a 2-1/2-month high earlier in the session. The benchmark had closed 0.2% lower on Friday.
The Reserve Bank of Australia (RBA) is scheduled to have its final meeting of the year on Dec. 5.
Soft inflation and retail sales data last week helped alleviate rate hike fears among traders.
“That sort of macro data that we got last week has… seen expectations grow that the RBA won’t hike this week and they may be seeing the end of the hiking cycle,” said Josh Gilbert, a market analyst at eToro.
A Reuters poll showed that investors expect the RBA will keep its key interest rate unchanged on Tuesday, while a rate cut is not expected until the fourth quarter of next year.
Among individual stocks, Australia’s largest power retailer, Origin Energy lost about 4% before it went into a trading halt.
Origin’s investors have voted against the Brookfield-led consortium’s $10.6 billion buyout bid.
Among indexes, gold stocks closed at a near seven-month high, rising 3.2%, as the bullion hit an all-time high on a weaker dollar following the US Federal Reserve Chair’s dovish comments.
Australian shares snap 3-day gaining streak
Top gold miners Northern Star Resources and Evolution Mining gained 3.7% and 2.5%, respectively. Heavyweight mining stocks rose 1.5% with BHP rising 1.7% and Rio Tinto gaining 1.6%.
Rate-sensitive financials index jumped about 0.4% with the ‘big four’ banks rising between 0.1% and 0.9%.
Bucking the trend, energy stocks fell 1.3% as scepticism over voluntary output cuts from OPEC+ and global fuel demand growth clouded the sector’s outlook.
New Zealand’s benchmark S&P/NZX 50 index was flat at 11,367.81 points.
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